Expanded Choice and Cooperation in Supply Schedules

Allow for Expanded Choice and Cooperation in the Use of Supply Schedules

Background

Consolidated government procurement actions tend to maximize the
economic advantage of volume buying with lower costs for the taxpayer.
Currently, governments at various levels cannot enter into arrangements
to consolidate their procurement requirements and then place orders
under one another's contracts. In addition, federal grantees and
qualified nonprofit agencies for the blind and others with severe
disabilities, which are awarded government contracts under the program
operated by the Committee for Purchase from People who are Blind or
Severely Disabled, are not authorized to use federal supply services.

The federal government supply sources, such as the Defense Logistics
Agency (DLA), the General Services Administration (GSA), and the
Department of Veterans Affairs (VA), consolidate the requirements of
various federal agencies for procurement purposes. As a result, these
procuring agencies secure price advantages from volume buying. In
certain circumstances, it is to the federal government's advantage to
use supply sources established by state and local governments.

Federal government supply sources are currently authorized to procure
and supply personal property and nonpersonal services for the use of
executive agencies, mixedownership government corporations,1 the
District of Columbia, the Senate, the House of Representatives, the
Architect of the Capitol, and certain other organizations authorized by
law to use federal supply sources.  However, they cannot acquire items
for state or local governments, nor may federal agencies use state or
local supply sources.

Federal agencies must acquire certain supplies and services from
qualified nonprofit agencies for the blind or others with severe
disabilities approved by the Committee for Purchase from People who are
Blind or Severely Disabled.2 Normally the contracts with these nonprofit
agencies are fixedprice contracts. The Federal Acquisition Regulation
(FAR) provides that agencies may authorize certain contractors
(generally costreimbursement contractors) to use government supply
sources if it is in the government's interest to do so.3

Need for Change

Federal managers will benefit if they have the option of entering into
arrangements with state and local governments to consolidate
requirements for procurements under a single contract.

One recent example involving the Department of Veterans Affairs
demonstrates the potential benefits. A state Veterans Home was
constructed on the federal VA Medical Center site in Albany, New York.
This provided veterans with convenient access to both VA and state
medical facilities. Even though the state home was located on federal
property, the VA and the state could not consolidate their common
service requirements under one contract.  Both VA and the state had to
enter into separate contracts for services such as snow removal, trash
removal, and laundering. As a result, the VA and state were unable to
achieve the cost efficiencies that would have resulted from single
contracts.

Allowing governments at various levels to enter into agreements to use
one another's contracts represents a winwin situation for the
governments and the taxpayers. Governments at all levels will reduce
administrative staffs and costs if they are authorized to use one
another's contracts. In addition, all levels of government will be able
to negotiate better prices as a result of the increased volume of sales
under the contracts. Contract consolidation will be particularly
beneficial to governments in the areas of new technology, such as
alternate fuel vehicles, energyefficient computers, and products
containing recycled material. Governments at all levels would have a
greater impact on the marketplace and could acquire products and
services at lower cost.

If grantees could use federal supply sources, specifically the Multiple
Award Schedules, they would be able to do more with the funds provided
to them through the grant. Similarly, nonprofit agencies awarded
contracts under the program administered by the Committee for Purchase
from People who are Blind or Severely Disabled would be able to reduce
the cost of the supplies or services provided to federal agencies under
such contracts if they were able to acquire the supplies used to produce
the item or service at a lower cost. The workforce and procurement
systems are already in place at the federal level to accomplish this.


Endnotes

1. Government Corporation Control Act (31 U.S.C. 9101).

2. Javits Wagner O'Day Act (41 U.S.C. 4648c).

3. Part 51, Federal Acquisition Regulation (48 CFR Part 51).